Issues that caused the loss of around 227,000 fish at Atlantic Sapphire Denmark operations can be expected to be a feature of land-based salmon farming at least in the short to medium term, analysts told IntraFish.

Atlantic Sapphire Denmark experienced the mortality event in one of its grow-out systems on Saturday, pushing next harvest revenue back by about four months, with preliminary analysis indicating the cause as higher than desired nitrogen levels.

The company says the issue has been addressed in a design modification.

It is probably not the last time the land-based industry will hear about mortalities in the same way that issues occur from time to time with traditional open pen farming, Danske Bank analyst Knut Ivar Bakken told IntraFish.

"It think it shows that we are still on a learning curve and it is still difficult to produce salmon onshore and, of course, the consequences, if you have certain issues, they are material," he said.

"Even when you are successful at doing land-based salmon farming there is still going to be some issues from time to time."

On Monday the mortality incident sparked an initial 20 percent drop in Atlantic Sapphire's share value on the Oslo Market, although it later made a small recovery.

Although Atlantic Sapphire's share price has been strong for a "long period of time", the incident underlines the risky nature of land-based farming because of increased potential pitfalls compared with traditional salmon farming," said Pareto Securities Carl-Emil Kjolas Johannessen.

Johannessen said he is not surprised by the market reaction to the incident.

"You get a lot uncertainty because nobody really knows how this will continue and whether this is a one-time event or if it can happen more frequently."

But he also said the company and the industry will likely learn from the episode and produce better technology and production systems.

Sparebank 1 Markets analysts Thomas Myrholt agrees, predicting that while land-based production can expect a successful future, all companies are likely to experience teething problems at one time or another.

"You have to remember this is still new technology in the development stage, so we are going to see these kind of events over the coming years," he said.

Aquaculture

Analysts: Atlantic Sapphire mass mortality unlikely to be the last for land-based industry